28 January, 2016
In the recent case of ANJ v ANK [2015] SGCA 34 the Singapore Court of Appeal made a landmark pronouncement that has realigned the application of the law governing the division of matrimonial assets after the dissolution of a marriage.
Under Section 112 (﴾1)﴿ of the Women’s Charter, the court has to divide matrimonial assets between parties in a just and equitable manner. This broad brush approach has been the guiding principle of division of matrimonial assets under family law in Singapore.
The section proceeds to set out a non-exhaustive list of 8 factors that the Court could take into account in its application. Of this, the extent of contributions by the parties in money, property or work is but one factor. However, parties and many family lawyers have long and often proceeded to the basis that the starting point of the exercise is to look direct financial contributions, indirect contributions and then other factors.
Despite the fact that the division of matrimonial assets is founded on marriage being a co- operative partnership of equal efforts, there is often a tendency to favour the party making the direct financial contributions towards the acquisition of the matrimonial assets.
One common approach that was used in the lower courts tended to be the ‘uplift approach’ with the direct financial contributions of each party to the acquisition of matrimonial assets being the starting point. The court would then adjust the proportions by giving the spouse with a greater non-financial contribution an ‘uplift’ to his/her proportion. This approach in fact resulted in a double credit to one party as that party will gain the percentage of the uplift which would be correspondingly deducted from the other party.
The Court of Appeal has now affirmed its approach in ANJ v ANK in the more recent case of Twiss, Christopher James Hans v Twiss, Yvonne Prendergast [2015] SGCA 52 that the way to approach the process is in these structured steps:
(﴾a)﴿ Express as a ratio the parties’ direct contributions relative to each other, having regard to the amount of financial contribution each party made towards the acquisition or improvement of the matrimonial assets;
(﴾b)﴿ Express as a second ratio the parties’ indirect contributions relative to each other, having regard to both financial and non-financial contributions; and
(﴾c)﴿ Derive the parties’ overall contributions relative to each other by taking an average of the two ratios above, keeping in mind that, depending on the circumstances of each case, the direct and indirect contributions may not be accorded equal weight and one of the two ratios may be accorded more significance than the other.
The benefit of this method is that it allows the courts to provide equal emphasis on the financial and non-financial contribution of parties.
With respect to step (﴾c)﴿, the Court of Appeal in ANJ n ANK also opined that the structured approach was not designed to provide a definitive answer in all situations. Other relevant considerations which may be taken into account including the fact that:
- Indirect contributions tend to feature more prominently in long marriages,
- Direct contributions would command greater weight where the pool of assets was extraordinarily large and all of the assets were accrued by one party’s exceptional efforts, and
- Courts tend to lean in favour of homemakers who have painstakingly raised children to adulthood at the
- expense of their careers, as opposed to the engagement of a domestic helper who would lessen the responsibilities of home-making.
The Court of Appeal’s decision has attempted to provide further guidance to how litigants’ expectations on the likely proportion of division of matrimonial assets may be managed, but the fact remains that asset division in matrimonial cases continues to be an art, and not a science.
For further information, please contact:
Malathi Das, Joyce A Tan & Partners
